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Canada’s two largest wireless operators increased their data overage fees for new customers before the busy back-to-school shopping season, a move industry watchers suggest is designed to convince customers to upgrade to pricier plans to avoid extra charges.

This week, Rogers Communications Inc. increased its overage fees to $7 per 100 megabytes from $5 per 100 MB, matching BCE Inc.’s increase to $7 per 100 MB in April. Canada’s wireless regulator dictates that carriers must stop data overage charges at $50 per account per billing cycle unless a customer expressly consents to keep racking up their bill, so higher fees mean consumers will hit the $50 limit more quickly.

The fee hikes come as data consumption becomes increasingly important for carriers’ bottom lines. As consumers burn through data streaming and sharing videos on their mobile devices, the major operators’ average revenue per user has risen as people upgrade plans or get dinged with overage fees.
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Industry players and consumer advocates think the price changes reflect preparation for a deluge of new customers in the fall, a popular time to buy new phones, rather than a reaction to the wireless code updates.
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[PIAC] believes the overage fee, now $70 per gigabyte, has no connection with the actual cost of providing the service. PIAC remains disappointed with the Competition Bureau for not keeping a closer eye on retail telecom pricing, he said.

“It looks funny to people to see identical price increases on the same aspect of wireless service in roughly the same period from major market leaders.”

“They need to do a little looking at least and sabre rattling to keep the players honest until a really viable fourth player shows up,” Lawford said. “It looks funny to people to see identical price increases on the same aspect of wireless service in roughly the same period from major market leaders.”

I will never buy an HTC ever again! (two broke within 4 years, which were well taken care of)

Learn about price collusion, https://www.reddit.com/r/canada/comm...n_of_canadian/ Canada has the highest utility rates in the G7 countries. Say no to price collusion, be informed of the CCTS, Industry Canada and the CRTC. The working class needs affordability in today's society.

Yeah, it is sad, speaking as a Canadian who has lived in the US for about 25 years working in tech. Better/more job opportunities. Lower cost of living. Higher salaries, in tech at least. Health care is the one thing that is more expensive in the US.

Whenever I consider moving back to Canada, the lower salaries and higher cost of living makes me reconsider. I occasionally do a Canadian job search, and the total comp numbers discourage me pretty quickly.

Last edited by mch; 07-09-2017 at 11:16 PM.

"I didn't get fat by accident. This was a personal choice. " - Kevin Gillespie

Canadian Wireless Pricing

While Australia (with an even lower population density than Canada's) gets competition right with MVNO BYOD offers of as low as $17 per month for 5GB of data and unlimited calls/texts, tax included

Is the small fraction of Canada (by area) that has cellular coverage any less densely populated than the covered areas of the US or Australia?

I don't think carriers anywhere are terribly enthusiastic about covering areas that are uninhabited or very sparsely populated.

I am not sure I buy the low national population density drives higher prices argument, unless the uninhabited and mostly uninhabited places have coverage. Certainly economies of scale exist, but the Canadian pricing story is undoubtedly more complicated.

Is the small fraction of Canada (by area) that has cellular coverage any less densely populated than the covered areas of the US or Australia?

I don't think carriers anywhere are terribly enthusiastic about covering areas that are uninhabited or very sparsely populated.

I am not sure I buy the low national population density drives higher prices argument, unless the uninhabited and mostly uninhabited places have coverage. Certainly economies of scale exist, but the Canadian pricing story is undoubtedly more complicated.

Australia has an even lower population density overall compared to Canada, yet they still have a healthy and very competitive wireless market with several MVNO's. I would say that Australia would be a better comparison vs. the USA because Australia have very similar population characteristics as Canada with a small population spread across a big area and most of the population in just a few major cities. The USA on the other hand simply has better economies of scale with a population around 10x more than Canada or Australia.

Oligopoly is a market structure in which a small number of firms has the large majority of market share. An oligopoly is similar to a monopoly, except that rather than one firm, two or more firms dominate the market. There is no precise upper limit to the number of firms in an oligopoly, but the number must be low enough that the actions of one firm significantly impact and influence the others.

BREAKING DOWN 'Oligopoly'

An example of an oligopoly is the wireless service industry in Canada, in which three companies – Rogers Communications Inc (RCI), BCE Inc (BCE) subsidiary Bell and Telus Corp (TU) – control approximately 90% of the market. Canadians are conscious of this oligopolistic market structure and often lump the three together as "Robelus," as though they were indistinguishable. In fact, they are often indistinguishable in price: in early 2014 all three companies raised the price for smartphone plans to $80 in most markets, more or less in tandem.

This example shows that participants in oligopolies are often able to set prices, rather than take them. For this reason oligopolies are considered to be able increase profit margins above what a truly free market would allow.

Most jurisdictions have laws against price fixing and collusion. An oligopoly in which participants explicitly engage in price fixing is a cartel: OPEC is one example. Tacit collusion, on the other hand, is perhaps more common though more difficult to detect.